Cars aren't smartphones

The digital transformation of the auto industry has hit a speed bump: Slower-than-expected electric vehicle adoption has delayed the rollout of intelligent, software-defined vehicles.

The big picture: Automakers are forecasting billions of dollars in recurring revenue from software and services that improve over time through constant updates.

• That requires a next-generation electrical architecture — think of it as the car's brain — to handle everything from ride dynamics and safety functions to the in-car experience that consumers want.

Automakers dream of being more like Apple, with an elegant operating system like iOS that enables the same digital experience across all their vehicles.

• Tesla and other EV startups already have such platforms, and they regularly send software updates to add features or improve performance.
• But they had an advantage: Their modern cars were designed from scratch.
• Legacy automakers are saddled with complex software networks cobbled together from more than 100 electronic control units that manage specific functions like braking or infotainment.
• Even minor software updates are a hassle with such a fragmented system.

The shift to electric vehicles seemed like the ideal time for many automakers to toss out those antiquated architectures in favor of a Tesla-like approach.

• Many companies who yoked software modernization to their EV development plans, however, are now thinking better of it.

Driving the news: Ford recently pulled the plug on an ambitious next-generation software project, deciding instead to pour those efforts into improving its existing architecture.

• The fully networked vehicle project (FNV4) was to have been the foundational software platform for a future lineup of smart, connected vehicles.
• In a blog post explaining the pivot, Doug Field, Ford's chief EV, digital and design officer, noted: "The world has changed since automakers, including Ford, laid out plans to rapidly redesign their vehicles for an electric future."
• EV adoption has been slower than expected, he noted, and Ford's digital transformation shouldn't leave behind customers who prefer gasoline or hybrid vehicles, he wrote.

• Instead, Ford will take a more incremental approach to software, building upon the digital experience launched recently in the Ford Explorer and Lincoln Nautilus and Navigator and deploying it across its full portfolio of vehicles.
• The move will save money, Ford CEO Jim Farley told analysts this week, and even make future products more affordable.

Between the lines: The software conundrum demonstrates why a car is not a smartphone and Detroit will never be like Apple.

• Phones are replaced every two or three years; cars stay on the road for 10 to 15 years or more.
• That means automakers are often stuck spending money to keep old technologies alive, even as they're investing billions to develop more sophisticated, modern vehicles.
• "Having a new electrical architecture on some vehicles and a legacy architecture on other vehicles and maintaining them all at the same time is not a good strategy for this new world," Field wrote.

What's next: Ford is still moving ahead with a clean-sheet strategy for its "skunkworks" low-cost EV platform coming in 2027.